I also have another unique option where I could sell off portions of my equity at $50 increments with a 3% fee - but I would also proportionally lose any cash flow and appreciation - so I'm not fully convinced that's a good option - although I understand I can try to use the equity sold to get higher returns, but I'd need to at minimum, cover the cash flow returns I've lost through the sale.

In the ideal scenario, we picture keeping the property as a cash flowing asset forever and letting our kids deal with it after we die.BUT, if that doesn't happen, and we decide to sell in 7 years or 10 years, I'm going to kick myself for losing out on the capital gains tax exclusion of $500k.  

The IRS loses cases... lots of them.

If you don't, what are the odds you do it improperly and therefore lose any protection you thought they had. 

You can still lose your investment in the LLC.

Many lose Vouchers because they cannot find a place.

Seller might not want to do so, but Seller's agent may require it or risk losing their license and exposing the broker.

Putting 20% down really puts a dent on our liquid money but better (we think) than it just losing value in the bank. 

Even if you are losing $500 per month which is ideally less than you'd pay in rent AND you get the other benefits of owning real estate like appreciation, value add equity, and the tax benefits.  

I mean just look at those that get all nervous with EM deposits even though they are not going to lose the money ..